Barack Obama issued a challenge to the Chinese president over the country's
human rights record as he made his welcoming address at the White House.

In comments that risk infuriating Beijing, the US president also raised the thorny issue of Tibet and said that the key to a nation's success is to uphold "the universal rights of every human being".

Although Mr Obama's message was couched in diplomatic language, it was a clear rebuke to Mr Hu and marked a toughening of America's stance towards China.

The four-day visit is seen as crucial to improving relations between the two countries.

In a rare joint press conference, Mr Obama delivered a frank message to Mr Hu on human rights. "We have some core views, as Americans, about the universality of certain rights – freedom of speech, freedom of religion, freedom of assembly – that we think are very important and that transcend cultures.

He also made clear his dissatisfaction over Chinese business practices. "I did also stress to President Hu that there has to be a level playing for American companies competing in China, that trade has to be fair," he said.

Mr Obama also called for talks between China and the Dalai Lama "to resolve differences in preserving the religious identity of the Tibetan people."

In his welcoming address: "History shows that societies are more harmonious, nations are more successful and the world is more just when the rights and responsibilities of all nations and all people are upheld, including the universal rights of every human being."

Mr Hu said he hoped to "increase mutual trust" between China and the United States and to build a "comprehensive" friendship for the 21st century. He also conceded that "a lot still needs to be done" in China on improving human rights.

"Our co-operation as partners should be based on mutual respect," he said. "China and the United States should respect each other's choice of development path and each other's core interests."

The Chinese leader arrived on the south lawn of the White House in a black limousine and was welcomed by the full pomp of a military band and 21-gun salute and last night enjoyed a state dinner.

It was a marked difference to his visit with George W Bush in 2006 when he was offered only lunch.

The two leaders are expected to discuss economic competition between the two countries and Mr Obama will broach the issue of how the US claims China has "undervalued" its currency. He said they had also addressed North Korea's "provocation" of South Korea.

The Obama administration has been critical of China's human rights record while at the same time trying to make it a global economic partner.

Earlier, Hillary Clinton, the US Secretary of State, declined to say whether China was a friend or foe. On Monday evening, Democrat Harry Reid, the Senate Majority leader, called Mr Hu a "dictator". Mr Reid was due to attend Wednesday night's state dinner in the Chinese leader's honour.

The Chinese president's US state visit has prompted protests from China's minority Uighurs, Tibetans, imprisoned democracy advocates and other marginalised groups. Mr Hu was greeted by several dozen demonstrators gathered outside the White House gates, holding Tibetan flags and demanding a "free Tibet".

Members of Congress from both parties have also this week threatened to impose tariffs and penalties on Chinese exports if the nation continues to manipulate its currency.

During the visit, the US and China are due to sign a deal to build a co-financed nuclear security facility in China.

The facility will offer training on boosting safeguards at nuclear installations and keeping track of atomic matter. American officials also want to conduct joint drills on dealing with atomic incidents and terrorist attacks as well as exchange nuclear monitoring technology.

Meanwhile, US officials announced a $45 billion (£28 billion) export deal had been signed with China, including Chinese purchase of 200 Boeing aircraft, deals that will support an estimated 235,000 US jobs.